What Creditors Cannot Take in Florida

Florida law protects a person’s home, wages, retirement accounts, annuities, life insurance, and several other asset categories from judgment creditors. These exemptions exist under separate statutes and constitutional provisions, each with its own qualification rules.

Exemptions are not automatic. A creditor can freeze or seize any asset, and the debtor bears the burden of asserting the applicable protection by filing a claim of exemption within 20 days. Knowing which assets qualify is the first step.

Your Home

Florida’s homestead exemption is the strongest debtor protection in the state. The Florida Constitution shields a primary residence from forced sale by judgment creditors, with no cap on equity. A person can own a home worth $5 million and protect every dollar of that equity.

The exemption covers up to half an acre inside a municipality or 160 acres outside one. The property must be the owner’s primary residence. Vacation homes, rental properties, and investment real estate do not qualify. Mortgages, property tax liens, mechanics’ liens, and HOA assessments are not blocked by the exemption.

Homestead sale proceeds retain protection temporarily if the owner intends to reinvest in a new homestead within a reasonable time. Courts evaluate both the stated intent and the debtor’s actual conduct when deciding whether proceeds remain exempt.

Wages and Earnings

The head of household exemption (§ 222.11) protects all wages from garnishment when a person provides more than half the financial support for a child or other dependent. If the debtor’s net earnings are $750 or less per week, the protection is complete. Above that threshold, wages remain exempt unless the debtor signed a written waiver.

Deposited wages retain their exempt status for six months if traceable to head of household earnings. Commingling exempt wages with non-exempt funds in the same account can destroy the exemption by making tracing impossible. Maintaining a separate wage account is the most reliable way to preserve the protection.

For debtors who do not qualify as head of household, federal law limits garnishment to 25% of disposable earnings or the amount exceeding 30 times the federal minimum wage, whichever is less.

Retirement Accounts

Florida provides unlimited creditor protection for retirement accounts under § 222.21. The exemption covers ERISA-qualified plans such as 401(k)s, pensions and profit-sharing plans, traditional and Roth IRAs, SEP-IRAs, SIMPLE IRAs, and inherited IRAs. There is no dollar cap.

Self-directed IRAs also qualify, provided the account structure complies with IRS requirements. Employee stock ownership plans and 529 college savings plans each receive separate statutory protection.

The exemption protects funds while held inside the retirement account. Once money is withdrawn or distributed, it loses its protected status and becomes reachable by creditors unless deposited into another exempt form.

Annuities

The annuity exemption under § 222.14 protects the cash surrender value and proceeds of annuity contracts issued to Florida residents. The protection has no dollar limit and applies to both fixed and variable annuities purchased through licensed insurance companies.

Private annuities created through individual contracts rather than insurance companies may not receive the same protection. Courts have distinguished between commercially issued annuity products and informal payment arrangements structured as annuities. The exemption is strongest when the annuity is purchased from a licensed carrier before any claim arises.

Life Insurance

The life insurance exemption under § 222.14 protects both the cash surrender value and the death benefit of policies issued on the lives of Florida residents. Whole life and universal life policies accumulate cash value that creditors cannot reach. Term policies have no cash value component but their death benefit remains protected.

The death benefit must pass outside of probate to retain full protection. If the policy proceeds flow through the insured’s estate, they become available to creditors of the estate. Naming a specific beneficiary rather than the estate preserves the exemption.

Tenants by the Entireties Property

Tenants by the entireties is a form of joint ownership available only to married couples. Property held as TBE is shielded from the individual creditors of either spouse. A creditor with a judgment against one spouse cannot force the sale of, lien, or garnish TBE property.

TBE protection applies to bank accounts, investment accounts, real property, and personal property. Both spouses must agree to the ownership form, and the property must be acquired during the marriage. The protection does not apply to joint debts where both spouses are liable.

Social Security and Federal Benefits

Social Security benefits receive absolute federal protection from private creditor garnishment under 42 U.S.C. § 407. The protection applies regardless of the amount. Banks must automatically protect two months of directly deposited Social Security funds under 31 CFR Part 212, even without a claim of exemption filing.

Supplemental Security Income, veterans’ benefits, workers’ compensation, disability income, and unemployment compensation are each independently exempt. These protections are federal or statutory and cannot be waived.

Personal Property

Florida’s personal property exemption (§ 222.25) shields up to $1,000 in personal property and a motor vehicle worth up to $5,000. A debtor who does not claim a homestead exemption can claim an additional $4,000 in personal property, raising the total to $5,000 plus the vehicle exemption.

These are among the lowest personal property exemptions in the country. A vehicle worth more than $1,000 is exposed to the extent it exceeds the cap. Jewelry, electronics, collectibles, and other personal property above the exemption thresholds are reachable by creditors.

What Creditors Can Take

Understanding what is protected requires knowing what is not. The following assets are generally reachable by judgment creditors in Florida:

Non-homestead real estate, including rental properties, vacation homes, and undeveloped land, can be liened and sold to satisfy a judgment. Taxable brokerage and investment accounts that are not held inside a retirement vehicle or annuity are fully exposed. Bank account balances that exceed traceable exempt deposits are subject to garnishment.

Business interests in single-member LLCs face particular risk. A bankruptcy trustee can exercise management control and liquidate the assets. Multi-member LLCs with charging order protection provide stronger shielding, but only if the operating agreement and membership structure are properly maintained.

Non-exempt personal property above the statutory caps, accounts receivable, intellectual property, and cash reserves in non-exempt forms are all available to creditors. Vehicles worth more than $1,000, boats, and recreational vehicles have no special exemption.

Exemptions Do Not Protect Everything

Florida’s exemption framework is among the strongest in the country, but it leaves significant categories of wealth exposed. A person worth $2 million may protect $1 million in homestead equity, $400,000 in retirement accounts, and $150,000 in annuities. The remaining $450,000 in brokerage accounts and rental property sits fully exposed.

For non-exempt wealth above what Florida’s statutory protections cover, offshore asset protection trusts hold assets outside the U.S. legal system entirely. A Cook Islands trust is not subject to domestic court orders or federal bankruptcy jurisdiction, providing a structural layer that state exemptions cannot match.